obama win positive for commodities?

* U.S. presidential election in focus; dollar eyed

* Oil down 1 pct, holding $63; gold little changed

* London copper eases, Shanghai copper down 2 pct



By Ben Tan

SINGAPORE, Nov 4 (Reuters) - Commodities markets trod water

in thin trade on Tuesday ahead of the U.S. presidential election,

with investors closely watching the dollar and expected interest

rate cuts by major central banks.

After almost two years of campaigning, Democrat Barack Obama

and Republican John McCain swept across key battleground states

on Monday to wrap up a U.S. presidential election in which Obama

was leading but McCain hoped to pull off an upset.

[ID:nN03326620]

Indications of the outcome of the U.S. election could emerge

after the first polls begin to close at 2300 GMT on Tuesday.

"Traders are only focusing on one event for the next 24

hours, and that is the election," said Jonathan Kornafel, Asia

director of U.S.-based options trader Hudson Capital Energy.

"Although once the results are in, the market should still

head lower, no matter who wins. It's just that things appear to

be put on hold for the next 24 hours," he added.

Oil fell 1 percent to stand near a 17-month low, with U.S.

crude at $63.61 by 0458 GMT, after having shed nearly $4

the previous session on renewed fears of an economic recession,

with investors unwilling to take large positions before the U.S.

poll.

Gold was trading at $723.90 an ounce, just off a

13-month low, and little changed from New York's notional close

on Monday. [GOL/]

London Metal Exchange copper for delivery in three

months fell 0.4 percent to $4,075 and zinc fell 2.1

percent to $1,145. Nickel lost 2.5 percent to $11,700.

Shanghai metal fell 2.1 percent to 31,900 yuan ($4,666).

Chicago Board of Trade December wheat futures fell 1.9

percent to $5.51-¿ per bushel, after a 4.8 percent gain in

overnight U.S. trade. December corn futures lost 1.1

percent to $3.98-¿ per bushel and November soybeans rose

0.6 percent to $9.23 per bushel.

For a graphic showing commodity prices in 2008, click:

https://customers.reuters.com/d/graphics/CMD_WRP041108.gif

The direction of commodities prices is likely to be steered

by the dollar, which was little changed against a basket of major

currencies in quiet trade as investors sat on their hands ahead

of the U.S. poll. [USD/]

Australia slashed interest rates by a greater-than-expected

75 basis points, following rate cuts in the United States, China

and Japan last week.

Britain and the euro zone were expected to follow suit with

cuts of their own on Thursday in the face of mounting evidence

that the global financial crisis has already pushed much of the

world into a damaging recession.



OBAMA WIN POSITIVE FOR COMMODITIES

Analysts said a win by Democrat Barack Obama, who is leading

his Republican opponent, John McCain, in most polls, could be

slightly more positive for the dollar.

"Markets have priced in an Obama win because of his lead in

the polls. But if the Democrats win really big in the Senate and

the House, we will see a sharp move in equity markets, and by

extension, commodities," said MF Global analyst Edward Meir.

"There are strong arguments for a rise or a fall -- bears

make the case that additional spending may weigh -- but my

feeling is that markets will move higher as a strong majority

will allow the administration to pass legislation more easily."

Investors shrugged off weak data from the United States

released on Monday, possibly signaling that the bottom of the

sell-off was in sight.

U.S. auto sales dived 32 percent in October to lows unseen in

a quarter-century in a collapse that hit every major automaker

and offered little sign the industry had hit bottom.

[ID:nL3115304]

And U.S. factory activity, a barometer for future commodities

demand, also contracted sharply in October, falling to its lowest

in 26 years, as the financial crisis hit the world's largest

economy. [ID:nN03322916]

"The markets are not buckling, even after the horrendous

numbers from the United States. We didn't crash to new lows so

maybe we have hit bottom," Meir said.

(Additional reporting by Bruce Hextall in SYDNEY, Lewa

Pardomuan, Naveen Thukral; Editing by Nick Trevethan)

(([email protected]; +65 6870 3923; Reuters Messaging:

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Keywords: MARKETS COMMODITIES